Legislature(2009 - 2010)SENATE FINANCE 532

03/16/2010 03:00 PM FINANCE

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03:01:47 PM Start
03:02:00 PM SB230 || SB253
04:16:09 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                 SENATE FINANCE COMMITTEE                                                                                       
                      March 16, 2010                                                                                            
                         3:01 p.m.                                                                                              
3:01:47 PM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair  Stedman   called  the  Senate   Finance  Committee                                                                    
meeting to order at 3:01 p.m.                                                                                                   
MEMBERS PRESENT                                                                                                               
Senator Lyman Hoffman, Co-Chair                                                                                                 
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Charlie Huggins, Vice-Chair                                                                                             
Senator Johnny Ellis                                                                                                            
Senator Dennis Egan                                                                                                             
Senator Donny Olson                                                                                                             
Senator Joe Thomas                                                                                                              
MEMBERS ABSENT                                                                                                                
ALSO PRESENT                                                                                                                  
Frank  Richards,  Deputy  Commissioner,  Highways  &  Public                                                                    
Facilities,   Department   of  Transportation   and   Public                                                                    
Facilities;    Laura    Baker,   Director,    Division    of                                                                    
Administrative Services, Transportation;  Jim Beedle, Deputy                                                                    
Commissioner,   Alaska   Marine   Highway,   Department   of                                                                    
Transportation and Public  Facilities; Leta Simons, Director                                                                    
of   Administrative   Services,    Department   of   Natural                                                                    
PRESENT VIA TELECONFERENCE                                                                                                    
James  King, State  Parks  Director,  Department of  Natural                                                                    
SB 230    BUDGET: CAPITAL, SUPP. & OTHER APPROPS                                                                                
          SB 230 was HEARD and HELD in Committee for                                                                            
          further consideration.                                                                                                
SB 253    APPROP: DEFERRED MAINTENANCE/REPLACEMENT                                                                              
          SB 253 was HEARD and HELD in Committee for                                                                            
          further consideration.                                                                                                
    Department of Transportation and Public Facilities;                                                                       
      Department of Natural Resources; Department of                                                                          
                Environmental Conservation                                                                                    
SENATE BILL NO. 230                                                                                                           
     "An Act making and amending appropriations, including                                                                      
     capital appropriations, supplemental appropriations,                                                                       
    and other appropriations; making appropriations to                                                                          
     capitalize funds; and providing for an effective                                                                           
SENATE BILL NO. 253                                                                                                           
     "An  Act  making  capital appropriations  for  deferred                                                                    
     maintenance   projects,   equipment  replacement,   and                                                                    
     emergency  repairs;  and  providing  for  an  effective                                                                    
3:02:00 PM                                                                                                                  
Co-Chair Stedman discussed housekeeping.                                                                                        
               DEPARTMENT OF TRANSPORTATION                                                                                   
CAP  RN 48782                                                                                                                   
     Roads to Resources: Foothills West                                                                                         
FRANK  RICHARDS,  DEPUTY  COMMISSIONER,  HIGHWAYS  &  PUBLIC                                                                    
FACILITIES,   DEPARTMENT   OF  TRANSPORTATION   AND   PUBLIC                                                                    
FACILITIES, testified  that the proposed road  would provide                                                                    
access to the  community of Umiat and the  Gubik Gas Fields.                                                                    
He  stated  that  the  $8   million  would  fund  additional                                                                    
development for  the National Environmental Policy  Act, and                                                                    
environmental documents  and permits necessary  to construct                                                                    
an all-season road between the  Dalton Highway and the state                                                                    
airport at Umiat.  The efforts would not  obligate the state                                                                    
to build the  road, but would reduce the  lead time required                                                                    
before construction  could commence.  State land  within the                                                                    
Central North  Slope of the  Brooks Range, contain  17 areas                                                                    
rich  in natural  gas. The  United States  Geological Survey                                                                    
estimation was  that there  were 31  trillion cubic  feet of                                                                    
natural  gas   in  the  vicinity.  The   National  Petroleum                                                                    
Reserve-Alaska, located next to  Umial, contains a potential                                                                    
additional 51  trillion cubic feet  of gas.  Specifically at                                                                    
Umiat,  the Division  of Oil  and Gas  had refined  resource                                                                    
estimates  totaling  590  million   barrels  of  oil  and  7                                                                    
trillion cubic feet  of gas within the  road influence area.                                                                    
Currently  explorers in  the area  are  building ice  roads,                                                                    
which through tax credits are  costing the state $25 million                                                                    
per  year.  The  project  contributes  to  the  department's                                                                    
mission by improving the mobility of people and goods.                                                                          
3:05:28 PM                                                                                                                    
Senator Olson  asked if a right  of way for the  natural gas                                                                    
pipeline, and  not solely a  road, had been included  in the                                                                    
environmental   impact   statement.  Commissioner   Richards                                                                    
replied that  a transportation  corridor was  being examined                                                                    
that included  the road and utilities,  including pipelines,                                                                    
to extend from the Dalton Highway to Umiat.                                                                                     
3:05:57 PM                                                                                                                    
Senator  Thomas   inquired  about  the  expected   cost  and                                                                    
timeline to  build the  road. Commissioner  Richards replied                                                                    
the current  estimate was  $3 million  per mile.  Thusly, 75                                                                    
miles to Gubik  would cost $225 million. He  stated that the                                                                    
development  efforts  put  forth   by  the  department  were                                                                    
similar to  the efforts  that Exxon  was investing  in Point                                                                    
Thomson. He  suggested a  2 to 3  year timeline  to complete                                                                    
the environmental impact statement.                                                                                             
Senator Huggins  asked where crossing sites  were located on                                                                    
the  department's   priority  list.   Commissioner  Richards                                                                    
replied that identifying crossing  sites had been recognized                                                                    
as a need, but had not yet been worked into the program.                                                                        
3:08:43 PM                                                                                                                    
Senator  Huggins  recalled  a   2008  meeting  of  Anchorage                                                                    
communities where  an inventory of gasline  support projects                                                                    
had  been  identified.  He  questioned  the  status  of  the                                                                    
inventory and  whether it  was currently  being used  by the                                                                    
department. Commissioner Richards replied  that the list was                                                                    
still being referred to and  that the department intended to                                                                    
use federal highway dollars to fund the projects.                                                                               
3:09:56 PM                                                                                                                    
Commissioner  Richards continued  to  the statewide  federal                                                                    
programs section of the request.                                                                                                
CAP  RN 34752                                                                                                                   
     Commercial Vehicle Enforcement Program                                                                                     
LAURA BAKER, DIRECTOR,  DIVISION OF ADMINISTRATIVE SERVICES,                                                                    
DEPARTMENT OF TRANSPORTATION  AND PUBLIC FACILITIES informed                                                                    
the  committee  that  the   federal  funding  would  provide                                                                    
financial assistance  to the program  for the  prevention of                                                                    
accidents during hazardous material transportation.                                                                             
Co-Chair Stedman  asked if the  safety inspections  would be                                                                    
limited to  commercial vehicles.  Ms. Baker  understood that                                                                    
the  implication was  for commercial  vehicles. Commissioner                                                                    
Richards  added that  the department  had worked  within the                                                                    
existing  regulations.  He shared  that  there  had been  an                                                                    
issue concerning  intra-state and inter-state  commerce, and                                                                    
that a  mechanism to allow  the two  uses to be  legal under                                                                    
current state statutes was being discussed.                                                                                     
3:11:31 PM                                                                                                                    
CAP  RN 31375                                                                                                                   
     Cooperative Reimbursable Projects                                                                                          
Ms.  Baker explained  that the  request was  made up  of $12                                                                    
million in  statutory designated receipts, and  $1.5 million                                                                    
in  federal receipts.  The receipts  were for  services that                                                                    
were provided  to other state  and non-state agencies.  If a                                                                    
program  required special  drilling  requirements, or  other                                                                    
work that the Department  Of Transportation and Public Works                                                                    
(DOT) had  expertise for,  a reimbursable  service agreement                                                                    
would be entered in order to carry out the work.                                                                                
3:12:44 PM                                                                                                                    
Co-Chair Hoffman asked  for a description of  the Rural Dust                                                                    
Control   Demonstration   Project.   Commissioner   Richards                                                                    
replied  that  he  did  not  have the  cost  amount  of  the                                                                    
projects  offhand. He  shared that  the department  had been                                                                    
working with  the Denali Commission and  other regional non-                                                                    
profit organizations  on the project.  He agreed  to provide                                                                    
the committee with individual project specifics.                                                                                
CAP  RN 31376                                                                                                                   
     Federal Contingency Projects                                                                                               
Ms.  Baker explained  that the  allocation  would allow  for                                                                    
discretionary  funding for  highways, airports,  or projects                                                                    
that arose late  in the year that need  federal authority to                                                                    
complete the work within a  given season. The federal agency                                                                    
funds lapse  September 30,  2010, and  state books  close on                                                                    
August 30, 2010. The formula  funds would allow the state to                                                                    
complete the work that had already begun.                                                                                       
CAP  RN 38424                                                                                                                   
     Federal Emergency Projects                                                                                                 
Ms. Baker shared  that the funds were for  projects that had                                                                    
been  declared   "emergency  projects"  under   the  Federal                                                                    
Highway Administration  Program, and  that needed  repair or                                                                    
reconstruction due to damage from natural disasters.                                                                            
3:15:35 PM                                                                                                                    
CAP  RN 30643                                                                                                                   
     Federal Transit Administration Grants                                                                                      
Commissioner Richards explained that  due to the program the                                                                    
state  would receive  funds,  which  through a  departmental                                                                    
granting  process  could  seek   solicitation  by  means  of                                                                    
transit  agencies in  order to  provide  capital grants  for                                                                    
vehicles,  project   administration,  training,   and  small                                                                    
operating expenditures.                                                                                                         
3:16:16 PM                                                                                                                    
CAP  RN 6896                                                                                                                    
     Federal-Aid Aviation State Match                                                                                           
Ms. Baker explained  that the request was for  a federal aid                                                                    
match for  aviation improvements. She said  that state match                                                                    
to  the  federal formula  dollars  were  put in  a  separate                                                                    
appropriation to avoid individual pockets of general funds.                                                                     
3:16:59 PM                                                                                                                    
Senator Thomas  asked about CAP  RN 38424. He  wondered what                                                                    
happened  to the  unused disaster  funds. Ms.  Baker replied                                                                    
that  a  disaster declaration  from  the  governor would  be                                                                    
necessary  to  access  the funds.  The  funds  were  federal                                                                    
receipt authority, not "money in the bank".                                                                                     
3:17:36 PM                                                                                                                    
CAP  RN 32609                                                                                                                   
     Federal Aid-Highway State Match                                                                                            
Ms. Baker explained that the  match was required for surface                                                                    
transportation and other projects.                                                                                              
CAP  RN 33485                                                                                                                   
     Highway Safety Grants Program                                                                                              
Ms.  Baker stated  that the  federal receipts  fund programs                                                                    
that facilitate  communication with the public  on seat belt                                                                    
laws  and  other  highway safety  training,  networking  and                                                                    
advertising programs.                                                                                                           
CAP  RN 41923                                                                                                                   
     Other Federal Program Match                                                                                                
She stated that  the funds were for  non-aviation or surface                                                                    
transportation federal programs.                                                                                                
3:19:24 PM                                                                                                                    
CAP  RN 34018                                                                                                                   
     Statewide Safety Program                                                                                                   
Commissioner Richards  explained that  the funds  could only                                                                    
be used for specific safety related programs.                                                                                   
Co-Chair  Stedman asked  if the  department would  present a                                                                    
priority list  of projects to  Legislative Budget  and Audit                                                                    
(LB&A).   Commissioner  Richards   replied  that   when  the                                                                    
department received  the funds  they were spent  on specific                                                                    
safety  related  projects.  If granted  the  authority,  the                                                                    
funds  may be  used  to address  other, non-specific  issues                                                                    
pertaining to traffic safety.                                                                                                   
3:21:04 PM                                                                                                                    
CAP  RN 7470                                                                                                                    
     Airport Improvement Program                                                                                                
Commissioner   Richards   gleaned   the  list   of   airport                                                                    
improvement requests.                                                                                                           
CAP RN 47751                                                                                                                    
     Bethel: Airport Master Plan Update                                                                                         
CAP  RN 49164                                                                                                                   
     Cold Bay: Airport Improvements                                                                                             
3:22:06 PM                                                                                                                    
CAP RN 40555                                                                                                                    
     Cold Bay: Airport Rescue and Firefighting Building                                                                         
Commissioner Richards  explained that the  existing building                                                                    
was too small to accommodate  the new generation of vehicles                                                                    
and needed to be upgraded.                                                                                                      
CAP  RN 43255                                                                                                                   
     Chefornak: Airport Relocation                                                                                              
Commissioner  Richards  informed   the  committee  that  the                                                                    
request  would   fund  the  second   stage  of   the  runway                                                                    
relocation project through to completion.                                                                                       
CAP RN AMD 43240                                                                                                                
     Deadhorse: Airport Master Plan                                                                                             
3:23:00 PM                                                                                                                    
Commissioner Richards continued.                                                                                                
CAP  RN 41530                                                                                                                   
     Fairbanks    International    Airport:    Environmental                                                                    
     Assessment and Cleanup                                                                                                     
The  project would  address environmental  issues on  vacant                                                                    
lease  lots  by mitigating  and  cleaning  up the  lots  and                                                                    
bringing them into compliance.                                                                                                  
CAP  RN 41527                                                                                                                   
     Fairbanks International Airport: Equipment                                                                                 
Commissioner  Richards   relayed  that  the   program  would                                                                    
replace snow removal and firefighting equipment.                                                                                
CAP  RN 49633                                                                                                                   
     Golovin: Runway and Apron Improvements                                                                                     
     $12, 520,000                                                                                                               
Commissioner  Richards communicated  that the  project would                                                                    
bring the air strip at  Golovin into compliance with current                                                                    
standards  and provides  for an  improved equipment  storage                                                                    
CAP  RN 49104                                                                                                                   
     Haines: Airport Drainage Improvement and Taxiway,                                                                          
     Runway and Apron Rehabilitation and Fencing                                                                                
Commissioner Richards  said that  the project  would address                                                                    
the many deficiencies at the Haines Airport.                                                                                    
CAP  RN 49163                                                                                                                   
     Kodiak Airport Improvements                                                                                                
Commissioner Richards  stated that the  request specifically                                                                    
applies to  airport runway  surface improvements  and safety                                                                    
CAP  RN 49166                                                                                                                   
     Koliganek: Airport Reconstruction                                                                                          
Commissioner  Richards   relayed  that  the   project  would                                                                    
upgrade the runway to meet current design standards.                                                                            
3:24:22 PM                                                                                                                    
Senator Egan asked why two  snow removal equipment buildings                                                                    
were  necessary  at   the  Koliganek  Airport.  Commissioner                                                                    
Richards  replied that  new equipment  would be  required to                                                                    
meet  Federal Aviation  Administration (FAA)  standards, and                                                                    
that  another  building  would be  necessary  to  house  the                                                                    
Co-Chair Stedman  requested a summarization of  the existing                                                                    
project  requests pertaining  to federal  receipt authority.                                                                    
Commissioner  Richards  replied  that the  airport  requests                                                                    
were  part of  a ten  year master  plan, which  examined the                                                                    
development  needs of  the  listed  airports. He  summarized                                                                    
that runway  safety standard  compliance, and  completion of                                                                    
existing projects were priorities for the department.                                                                           
3:27:50 PM                                                                                                                    
Senator   Olson  inquired   about  language   on  page   54,                                                                    
specifically   the  term   "Part  77   Navigable  Airspace".                                                                    
Commissioner Richards  replied that  from the  term referred                                                                    
to  the slope  on  the sides  and ends  of  the runway  that                                                                    
create an imaginary surface that  must be taken into account                                                                    
for aircraft safety.                                                                                                            
3:29:27 PM                                                                                                                    
Co-Chair  Stedman continued  to  the Surface  Transportation                                                                    
Program requests.                                                                                                               
CAP  RN 32610                                                                                                                   
     Surface Transportation Program                                                                                             
Commissioner  Richards  informed   the  committee  that  the                                                                    
appropriation had  many sub-allocations and was  outlined in                                                                    
the Statewide Transportation Improvement Plan (STIP).                                                                           
Co-Chair Stedman requested the  committee focus on Page 104,                                                                    
Alaska  Marine  Highway   System:  Fleet  Conditions  Survey                                                                    
CAP RN 38577                                                                                                                    
     Alaska Marine Highway System: Fleet Conditions Survey                                                                      
Co-Chair  Stedman asked  if the  fleet survey  was performed                                                                    
annually. He  suggested CAP RN  38577 and CAP RN  40380 were                                                                    
analogous.  Ms.  Baker  responded  that  CAP  RN  38577  was                                                                    
reflected as a deletion in  the February 2010 capital budget                                                                    
Senator Ellis  queried CAP RN  49117: Arterial  Roadway Dust                                                                    
Control Program. He relayed that  he had received complaints                                                                    
from  constituents concerning  the cleaning  of state  roads                                                                    
under the previous  program. Commissioner Richards clarified                                                                    
that the  request was  for a new  federal project.  With the                                                                    
new  Environmental   Protection  Agency  (EPA)   permit  the                                                                    
department  would  be required  to  sweep  all state  routes                                                                    
twice  by  June  1st,  and  then twice  again  on  the  main                                                                    
arterial  roads by  first  snowfall.  Secondary roads  would                                                                    
require one sweep at  the aforementioned times. Commissioner                                                                    
Richards  asserted   that  the  street   cleaning  situation                                                                    
throughout  the state  would improve  under  the EPA  permit                                                                    
3:32:25 PM                                                                                                                    
Senator   Ellis   understood   that   federal   requirements                                                                    
associated  with the  requested  funds  would ensure  better                                                                    
performance   by  the   department.  Commissioner   Richards                                                                    
replied that  the funding was  not limited to  state routes.                                                                    
The program  covers all the  routes within  the municipality                                                                    
and  therefore benefits  both the  city  and state.  Senator                                                                    
Ellis  asked  if better  road  sweeping  could be  expected.                                                                    
Commissioner Richards replied yes.                                                                                              
3:33:34 PM                                                                                                                    
CAP RN 49140                                                                                                                    
     Coffman Cove: Wander Around Town Trail                                                                                     
Co-Chair  Stedman  directed  attention  to  Page  6  of  the                                                                    
Project  Review Listing,  Coffman Cove:  Wander Around  Town                                                                    
Trail.   He  questioned   the  validity   of  the   project.                                                                    
Commissioner Richards  replied that  the project  included a                                                                    
ten  foot wide  paved  pathway, which  would improve  access                                                                    
safety between the boat harbor and the ferry terminal.                                                                          
Co-Chair Stedman solicited further questions.                                                                                   
CAP RN 40396                                                                                                                    
     Anchorage Metropolitan Area Transportation Solutions                                                                       
CAP RN 39103                                                                                                                    
     Anchorage Metropolitan Area Transportation Solutions                                                                       
Senator  Ellis expressed  support from  constituents on  the                                                                    
proposed upgrades.                                                                                                              
Co-Chair  Stedman  continued  to   Page  7  of  the  project                                                                    
listings and solicited questions.                                                                                               
CAP RN 49131                                                                                                                    
     Mat-Su: Off System Bridges                                                                                                 
Senator Ellis asked for an  example of an off-system bridge.                                                                    
Commissioner  Richards explained  that an  off-system bridge                                                                    
was a  bridge found on a  municipal road and was  not on the                                                                    
state road system.  The bridges in the project  were in need                                                                    
of reconstruction to meet safety standards.                                                                                     
CAP RN 40358                                                                                                                    
     New Seward Highway: Rabbit Creek to 36th Avenue                                                                            
Co-Chair Stedman  requested clarification  of CAP  RN 40358.                                                                    
Commissioner  Richards  explained  that  the  project  would                                                                    
expand the  Seward Highway by  two lanes, from  Rabbit Creek                                                                    
to 36the Avenue. The project  was a component of the Connect                                                                    
Anchorage   Initiative,  which   the  department   had  been                                                                    
laboring over  for nearly  a decade,  and would  support the                                                                    
flow of traffic within Anchorage.                                                                                               
3:38:58 PM                                                                                                                    
Senator  Ellis   asked  about  sound  barriers   to  protect                                                                    
communities  in districts  where  road improvement  projects                                                                    
were occurring.  He stated that  in past  conversations, the                                                                    
department  had implied  that the  sound  barriers would  be                                                                    
included in the  Seward Highway upgrades. He  hoped that the                                                                    
noise  impact  on  the neighborhoods  would  be  taken  into                                                                    
account.  Commissioner   Richards  said  that  he   was  not                                                                    
familiar  with  the  sound  barriers   with  regard  to  the                                                                    
specific project.  Senator Ellis  reiterated his  desire for                                                                    
sound  barriers. He  added  that the  planners  at DOT  were                                                                    
aware  of  the  need  for  sound  barriers  in  the  project                                                                    
planning. Commissioner  Richards assured Senator  Ellis that                                                                    
the department would consider issue of sound barriers.                                                                          
3:41:55 PM                                                                                                                    
Senator Egan  thought that  $23 million  was a  low estimate                                                                    
when  considering  the  amount   of  work  expected  on  the                                                                    
project.    Commissioner   Richards    replied   that    the                                                                    
construction market  was highly competitive,  which resulted                                                                    
in very low  bids, and that the  department felt comfortable                                                                    
with the numbers.                                                                                                               
3:43:38 PM                                                                                                                    
CAP RN 36366                                                                                                                    
     Surface Transportation Preconstruction                                                                                     
Commissioner Richards stated that  the request would pay for                                                                    
the engineering  of the project.  It allows  for preliminary                                                                    
steps such  as; reconnaissance, preliminary  engineering and                                                                    
design,  right  of  way  acquisitions,  utility  relocation,                                                                    
permit application and other details.                                                                                           
Co-Chair Stedman  surmised that  if the committee  wished to                                                                    
influence  the  STIP  process,  now would  be  the  time  to                                                                    
improve the  funding. He expressed concern  that legislators                                                                    
had not  been involved enough  in the creation of  the STIP.                                                                    
Commissioner Richards replied that  the federal process that                                                                    
the department follows regarding  the STIP requires that the                                                                    
projects be selected  by a specific criteria.  He echoed the                                                                    
committee's concerns  and characterized the  federal process                                                                    
as challenging and cumbersome.                                                                                                  
3:47:23 PM                                                                                                                    
CAP  RN 38304                                                                                                                   
     Whittier: Maintenance and Operations                                                                                       
CAP AMD RN 48310                                                                                                                
     Alaska Marine Highways: Alaska Class Ferry: Vessel                                                                         
     Number 1                                                                                                                   
CAP AMD RN 49625                                                                                                                
     Scope Changes for Alaska Marine Highways: Alaska Class                                                                     
     Ferry: Vessel Number 2                                                                                                     
3:47:58 PM                                                                                                                    
JIM  BEEDLE,  DEPUTY  COMMISSIONER, ALASKA  MARINE  HIGHWAY,                                                                    
DEPARTMENT OF TRANSPORTATION  AND PUBLIC FACILITIES, relayed                                                                    
that the department  was seeking the authority  to spend $60                                                                    
million from  the Alaska  Marine Highway  Vessel Replacement                                                                    
Fund. A STIP had been  submitted and approved by the federal                                                                    
government, who would match the $60 million.                                                                                    
Co-Chair  Stedman wondered  if  the  marine highway  federal                                                                    
receipt money  could be  redirected to  highway improvements                                                                    
in metropolitan  areas. He  pointed out  that the  Parks and                                                                    
Seward  Highways needed  work  and that  jobs  needed to  be                                                                    
created in  the state. He  suggested using general  funds to                                                                    
purchase the Alaska  Class Ferry, which could  then be built                                                                    
in-state.  Mr. Beedle  understood that  the program  was not                                                                    
considered federalized until the  federal process had begun.                                                                    
However, the  9th Circuit Court  had ruled that  the instant                                                                    
federal dollars  were used  on a  project it  was thereafter                                                                    
considered a  federalized program. He discussed  the federal                                                                    
process  and the  limitations of  certain funding  under the                                                                    
Co-Chair  Stedman  stated  that  the governor  had  cut  $15                                                                    
million of  the $75  million the committee  had appropriated                                                                    
for infrastructure. He  felt that in-state hire  should be a                                                                    
main priority.  He expressed concern that  the appropriation                                                                    
had been  misguided. Mr. Beedle assured  that committee that                                                                    
the department was expecting  competitive bids from in-state                                                                    
businesses.  He  specifically   mentioned  Alaska  Ship  and                                                                    
Drydock INC. (ASD).                                                                                                             
3:53:16 PM                                                                                                                    
Co-Chair  Stedman  added  that   the  businesses  should  be                                                                    
competitive in the  price and quality of  the work provided.                                                                    
He asserted  that if the  state created policies  that built                                                                    
in-state   infrastructure,  jobs   could   be  created   and                                                                    
populations  in  coastal  regions  would  grow.  Mr.  Beedle                                                                    
3:55:27 PM                                                                                                                    
Co-Chair Stedman  wanted the  state to  have the  ability to                                                                    
build  Alaska Marine  Highway Vessels  in-state. Mr.  Beedle                                                                    
pointed out  to the committee  that ASD was not  currently a                                                                    
viable shipyard,  and did not have  consistent, high quality                                                                    
employees on  a year round-basis.  He hoped winning  the bid                                                                    
for the  project would improve  the motivate ASD  to improve                                                                    
its  situation. He  reported that  in Washington  State, the                                                                    
state provides general funds for  marine vessels to be built                                                                    
in-state.  The  department  had  been  forced  to  seek  out                                                                    
federal funding  for the project. Accepting  federal dollars                                                                    
for the project has limited project flexibility.                                                                                
Co-Chair Stedman requested that  the department research the                                                                    
options  available  to the  state  and  report back  to  the                                                                    
committee. He  added that  state waterfront  issues affected                                                                    
oil and gas discussions.                                                                                                        
3:58:04 PM                                                                                                                    
CAP RN 30633                                                                                                                    
     Airport Deferred Maintenance                                                                                               
Co-Chair  Hoffman   stated  that  the  backlog   of  airport                                                                    
deferred  maintenance  totaled  $90  million.  He  expressed                                                                    
concern for future funder  for airport deferred maintenance.                                                                    
Ms. Baker  clarified that the deferred  maintenance projects                                                                    
had been in  the governor's original capital  bill, but have                                                                    
since been  separated out as the  deferred maintenance bill.                                                                    
The  $3.5 million  in the  request if  for airport  deferred                                                                    
3:59:52 PM AT EASE                                                                                                            
4:01:04 PM RECONVENE                                                                                                          
Senator   Thomas   inquired   about   the   improvement   of                                                                    
intersections on the  new and old Steese  Highway, which had                                                                    
been  listed in  a  general obligation  (GO)  bond that  was                                                                    
passed in  2008. He hoped that  the bonds had been  sold and                                                                    
that he project  was ready to be  bid. Commissioner Richards                                                                    
replied that the  project had been discussed and  was in the                                                                    
development  stages.  He  was  not  aware  which  bonds  the                                                                    
project was  tied to. He said  that he would report  back to                                                                    
the committee as  to when the project would be  going out to                                                                    
bid. Senator Thomas expressed  frustration with the extended                                                                    
amount of  time it  took to  complete projects  when federal                                                                    
dollars  were involved.  Commissioner Richards  relayed that                                                                    
the department  had worked with  a tight  federal government                                                                    
timeline to  receive and obligate federal  stimulus dollars.                                                                    
The process  had required staff  to put GO bond  projects on                                                                    
hold.  He  stressed  that  the  department  was  working  on                                                                    
federal  projects,   general  fund  projects  and   GO  bond                                                                    
projects, and working diligently to use funds efficiently.                                                                      
Senator Thomas  referenced the capital request  for $450,000                                                                    
to fund  the Wander Around  Town Trail. He reported  that he                                                                    
had inquired of the department about  the cost of a one mile                                                                    
bike path  in Fairbanks and was  told that it would  cost $3                                                                    
million.     He  thought  that  was   extreme.  Commissioner                                                                    
Richards highlighted  that the Wander Around  Town Trail was                                                                    
only ten feet wide, not ten miles long.                                                                                         
4:05:56 PM                                                                                                                    
Co-Chair  Stedman requested  that Commissioner  Richards get                                                                    
back to the committee with answers to bike path concerns.                                                                       
4:07:23 PM AT EASE                                                                                                            
4:07:51 PM RECONVENE                                                                                                          
               DEPARTMENT OF NATURAL RESOURCES                                                                                
LETA   SIMONS,   DIRECTOR    OF   ADMINISTRATIVE   SERVICES,                                                                    
DEPARTMENT  OF  NATURAL  RESOURCES, testified  that  the  $4                                                                    
million  deferred maintenance  request  was made  up of  two                                                                    
allocations; one for  state parks, and one  for the Division                                                                    
of  Agriculture   Plant  Materials  Center.  There   are  21                                                                    
deferred maintenance projects, 20 are in state parks.                                                                           
DM   AMD RN 49370                                                                                                               
     State Parks Deferred Maintenance and Equipment                                                                             
Ms. Simons detailed  the projects 1-20 found  on Pages 42-43                                                                    
of the deferred maintenance requests (copy on file).                                                                            
Co-Chair Stedman requested more  information on the House of                                                                    
Wickersham. Senator  Egan requested that the  Gruening Cabin                                                                    
and  Wickersham  House   deferred  maintenance  projects  be                                                                    
separated. Co-Chair  Stedman requested  an energy  report on                                                                    
the Governor's Mansion.                                                                                                         
4:13:30 PM                                                                                                                    
Co-Chair  Hoffman  inquired  about  the  Wood  Tikchik  Area                                                                    
request.  He  wondered why  an  air  management program  was                                                                    
under  the  parks request.  Ms.  Simons  responded that  the                                                                    
project  included major  upgrades to  state parks.  Co-Chair                                                                    
Hoffman  questioned  whether  the project  belonged  in  the                                                                    
state  parks section  of the  deferred maintenance  request.                                                                    
Ms.  Simons  said that  they  could  be considered  under  a                                                                    
different listing.                                                                                                              
JAMES  KING, STATE  PARKS  DIRECTOR,  DEPARTMENT OF  NATURAL                                                                    
RESOURCES (via  teleconference), spoke to the  reasoning for                                                                    
the  funding in  the budget.  He stated  that there  was one                                                                    
plane in the division, located  in Dillingham. The plane was                                                                    
used  to  patrol  hunters,  search  and  rescue,  and  cabin                                                                    
observation.  He   added  that   the  plane  was   the  main                                                                    
transportation  in and  out of  the  park. Co-Chair  Stedman                                                                    
requested a written response concerning the airplane.                                                                           
4:16:09 PM                                                                                                                    
Senator  Olson asked  what patrolling  hunters entailed.  He                                                                    
also wondered if search and  rescue efforts could be left to                                                                    
the Department of Public Safety.                                                                                                
Mr. King  replied that  the staff and  the plane  were based                                                                    
close to the Wood Tikchik  Area Park, which often results in                                                                    
park  staff   being  the   first  responders   in  emergency                                                                    
situations.  Hunters  are   monitored  for  compliance  with                                                                    
licensing   requirements.  Senator   Olson   asked  if   the                                                                    
department  was doing  enforcement work  and citing  hunters                                                                    
for  violations. Mr.  King replied  that the  first response                                                                    
was to  educate but that a  ranger was assigned to  the park                                                                    
to issue citations if necessary.                                                                                                
Co-Chair Stedman reiterated the need to keep The People's                                                                       
House, commonly known as The Governor's Mansion, in                                                                             
excellent condition.                                                                                                            
The meeting was adjourned at 4:18 PM.                                                                                           

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